With the program, ‘employers have more time to stabilize and build and ensure workers can stay on the job, protect their incomes, and build new skills for the future’
The federal government is extending temporary flexibilities in the Employment Insurance (EI) Work‑Sharing program until March 31, 2027, in a move aimed at helping employers facing tariff‑related slowdowns avoid mass layoffs and retain workers.
The measures were first introduced on March 6, 2025.
As of Feb. 28, more than 1,500 Work‑Sharing agreements had been approved for businesses affected by tariffs, covering over 50,000 workers and helping prevent nearly 20,000 layoffs, according to Employment and Social Development Canada (ESDC).
“With the extension of Work‑Sharing temporary flexibilities, employers have more time to stabilize and build and ensure workers can stay on the job, protect their incomes, and build new skills for the future,” said Patty Hajdu, Minister of Jobs and Families and Minister responsible for the Federal Economic Development Agency for Northern Ontario.
The EI Work‑Sharing program allows eligible employees to receive EI Work‑Sharing benefits when they agree to work reduced hours due to a decrease in business activity beyond their employer’s control. This helps employers retain experienced workers while employees supplement reduced wages with EI benefits for hours not worked.
In 2025, the Canadian Labour Congress (CLC) called on the federal government to expand Work-Sharing programs.
Longer duration and easier access for employers
Under the temporary special measures, the maximum duration of Work‑Sharing agreements is doubled from 38 weeks to up to 76 weeks. The usual requirement for a cooling‑off period between successive agreements—equal to the length of the first agreement—is waived while the flexibilities are in place.
Employer eligibility has also been broadened. Businesses operating in Canada for just one year, rather than the standard two years, may now qualify. Non‑profit and charitable organizations experiencing reduced revenues as a direct or indirect result of tariffs are eligible, as are cyclical or seasonal employers and those that have seen a decrease in work activity of less than 10 per cent or greater than 60 per cent over the past six months.
For HR departments, the extended duration and expanded eligibility create more room to use reduced hours and job‑sharing arrangements as an alternative to terminations when demand drops.
Wider coverage for workers under Work‑Sharing
Employee eligibility has been expanded beyond year‑round permanent staff. Seasonal or cyclical employees can now be included in Work‑Sharing agreements, along with employees assisting in the employer’s recovery efforts.
ESDC is also simplifying recovery‑measure reporting requirements. Instead of demonstrating a return to normal business levels, employers will focus on maintaining business viability in the face of tariff measures.
To support workers during reduced hours, the government is launching the Worker Retention Grant for Work‑Sharing Employers, backed by approximately $102.7 million over two years. The grant will allow employers to provide training opportunities so workers can upskill while maintaining up to 70 per cent of their regular income during Work‑Sharing.
Through Job Bank, employers and workers will have access to a dedicated Training Finder and links to courses. ESDC said this is intended to help workers “build new skills for the future” while remaining attached to their current employer.
“Canadian workers are the backbone of our economy, driving success in every corner of our country,” Hajdu said in the release. “By investing in skills, training, and growth, we are equipping workers with the tools they need to succeed today, and the confidence to lead tomorrow.”
In an article posted on LinkedIn, Andrew Easto, a pensions, benefits and compensation lawyer in the Hicks Morley’s Toronto office, shared that eligible employers can apply for the Grant by email. The email must include the following information:
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organisation name
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contact information (email and phone number)
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Work-Sharing agreement number
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an attestation to fostering access to training opportunities with details of the approach
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an indication (yes or no) of any amounts owed and in default to the Government of Canada
“This Grant will improve the attractiveness of Work-Sharing agreements for employers by supporting workforce retention and skills development,” he said. “This will enable employers to maintain a more skilled, adaptable, and engaged workforce while minimizing operational and retention risks. The enhanced income replacement available to participating employees will soften the financial impact of Work-Sharing on your employees.”
The Work-Sharing program has its limitations, according to experts.
Workforce tariff response
The Work‑Sharing flexibilities and the new grant form part of the federal government’s broader Workforce Tariff Response. On Sept. 5, 2025, the government announced $570 million in funding for measures to protect, build and transform Canadian industries most affected by tariffs and global trade disruptions.
Provincial and territorial governments are delivering targeted training and employment services under this initiative, funded through EI contributions by workers and employers. Six Workforce Alliances are also being created to mobilise industry leaders, workers and training institutions around a shared vision of a “skilled, adaptable” workforce, in sectors including housing and construction, transportation and supply chains, advanced manufacturing, energy and electricity, mining and minerals, and the care economy.
Employment and Social Development Canada said these combined measures are intended to strengthen community resilience, help workers return to the labour market more quickly and support industries as they adjust to ongoing tariff and trade pressures.
